Lab born in layoffs finds formula for success

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BROOKINGS, S.D. – At perhaps their darkest hour, as the unexpected announcement about job cuts and a century-old venture being closed down still reverberated in the room, Regina Wixon pushed a note across the table.

Staff in the Olson Agricultural Analytical Services Lab on the South Dakota State University campus couldn't believe their ears. Caught in a budgetary pinch sparked by the national recession, the university decided to lay off dozens of faculty and staff – and even shut down entirely its venerable and highly respected ag services lab.

Seventeen people at Olson would lose their jobs. Amid the disbelief in the room, lab manager Nancy Thiex stared at the piece of paper. "Let's start our own business," it read.

That was 20 months ago. Today Wixon and others from the Olson lab have in fact pulled off a phoenix story of their own – rising from the ashes of those turbulent times to create a private ag analysis business in Brookings.

They call it South Dakota Agricultural Laboratories. The work they perform is much the same as they did at Olson – analyzing everything from feed and forage to soil, water and animal tissue.

Thinking about spreading manure on your farm fields? Wixon's lab will check its nitrogen, phosphorous and potassium levels to ensure you won't accidentally damage the land. Need to know the nutrient or mineral content of the feed and forage you're giving to your livestock? Again, that's what the chemists at South Dakota Ag Labs do.

"When they decided to close the lab here on campus, it caused us some heartburn," said Todd Trooien, a natural resources engineer at SDSU. "We have to get these analyses done, and it's really helpful to have a local lab so we don't have to haul them a long way. So I'm really glad this worked out for them."

That glad feeling seems to stretch across the SDSU and Brookings landscapes these days. In April 2011, Dean Barry Dunn of SDSU's College of Agriculture and Biological Sciences wasn't universally beloved as he was announcing the force reductions — most of them in his college. But Wixon insists now that it was Dunn who helped the Olson lab staff land on its feet.

The agriculture dean "was put in a very difficult position. That's just how it was," Wixon said. "But he's been one of the keys as far as helping us get to where we are today."

Though SDSU shut down the Olson lab in October 2011, Dunn allowed staff members to stay on afterward to catalog lab equipment and do other things. To a degree, it gave them a few more paychecks until they got their own venture running. He also put their business information on an SDSU website for people who needed sample work done.

"It wasn't very much," Dunn said. "They kept on running on campus as long as they possibly could. We tried to help them where we could until they got their business up and running. But it really was their hard work and vision that pulled it off."

In the community, Van Fishback of Fishback Financial Corp. could hear the rumblings about SDSU's decision to cut jobs and close the lab. So he reached out to Dunn to see whether there was some way his business could give a hand to the Olson staff in the event they might want to consider creating a private business.

"I'm not married to the university. I'm not married to the professors there," Fishback said. "But whenever there is difficult moment for Barry or anyone else on the campus ... my inclination is to reach out and say, 'All right, is there some opportunity here for the private sector to marry up with this initiative and turn it into basically a nonpublic entity?' "

The fact is, other land grant institutions have faced tough decisions similar to what SDSU ended up doing with Olson lab, Dunn said. There used to be four research scientists at Olson in addition to the chemists. But as researchers retired, they weren't replaced, and its mission drifted solely to service work, Dunn said.

"The real magic of the university happens not just in a service lab, but turning that influx of information and data into researchable questions and then answers," he said. "As that research function had drifted away, there weren't grant dollars being generated. There weren't new dollars being generated. I don't think the private sector can do as good in research as a land grant can. But I'm convinced the service sector can do a very good job."

At first, Wixon and the others hoped that maybe the state Department of Agriculture would retain their services as a private arm of the department. When that didn't happen, Wixon went to work with Fishback to develop a private lab.

On the east edge of Brookings, Fishback had built a state-of-the-art facility called Brookings BioSpace, inviting researchers and innovators to bring their business there. It became a natural landing point for Wixon and the others.

After the Olson lab closed, several of its 17 employees retired. Some moved on to other labs and opportunities. Six former employees ended up in the new venture at Brookings BioSpace.

For some of those who followed Wixon to the new lab, the heartache of 20 months ago has not been entirely forgotten. Lawrence Novotny, 64, started working at Olson on March 1, 1970. He would have retired from there but instead became the lead designer on Wixon's new South Dakota Ag Labs.

"I still think SDSU made a mistake in closing the lab. It helped to provide good public relations for SDSU, and it had a long history of working with research programs and providing good analysis," Novotny said. "But they made their decision. It turned out as good as it could have."

Good? Wixon has contracts with the state departments of Agriculture and Transportation, with the South Dakota Wheatgrowers and the Beef Council, and ranchers and farmers from California to Texas to Pennsylvania. They have samples waiting to be analyzed.

"Things happen for a reason, I guess," she said. "It's funny; I was making out payroll today and I was shocked that I had to write out 21 checks. That's part-time and full-time staff."

Who could have imagined such a thing 20 months ago? Regina Wixon, it turns out. But then, she had a pretty good idea about the possibilities.

"The quality of Olson was its strength," she said. "It was a good, quality lab. We were able to build on that reputation. We really do owe where we are today on the reputation we built at Olson."